4 ms·

I think a tax on vacant properties is potentially a better way to go, though checking and enforcement could be the issue (exempting one's primary and maybe seco

I think a tax on vacant properties is potentially a better way to go, though checking and enforcement could be the issue (exempting one's primary and maybe secondary homes); multi-unit housing would also be exempt. This would place more downward pressure on rents and decrease the investment upside on buying. I'm sure this is a bad idea in a number of ways I haven't considered.

ryukafalz 3y ago
Don't have sources offhand but my recollection is that vacancy taxes have also been tried before and, while they do have some effect, the vacancy rates in most locales with high costs of living are already low enough that it doesn't help that much. Vacancy rate statistics include things that are pretty natural and you wouldn't really want to penalize, like an apartment being briefly vacant after the previous tenant moves out and before the next tenant moves in. So you can't just look at the rental vacancy rate in a city being (say) 3% and conclude that those 3% of units in the city are being held vacant and off-market. There may be some of those, but it's a far lower percentage. Which is to say, institute a vacancy tax if you like (it won't really hurt if done sanely), but realize that it won't be a silver bullet here.
ZoomerCretin 3y ago
This is so difficult to enforce. You're going to have people go door-to-door checking if houses are vacant? What if someone goes on vacation? States require legibility. The simplest way to enforce high land and property utilization is to tax all property. In California, for example, you have reports of people who move and use their old home in the Bay Area for storage because they're paying the same nominal property tax rate from 40 years ago. If they were paying a yearly 1% tax on the value of their property (instead of <0.05%), they'd rent or sell it immediately. Same deal in China, except more extreme. Property _is not taxed_, so there are/were a lot of people building apartments and leaving them vacant, waiting for prices to rise over time. Neither of these situations serve the material needs of people today who need cheap, high-quality, and abundant shelter. Plus, your vacant property tax proposal excludes the (500k+?) many empty bedrooms in occupied homes. If someone's kids have grown and moved out, their old rooms are now vacant. How many people simply leave these rooms vacant for years and decades? A blanket property tax increase would strongly incentivize the renting of these rooms.
- brewdad 3y ago
  Maybe I'm just a grumpy old man but you'd have to raise my property taxes (already above the national median) by 3-4x before I'd even consider renting out our empty bedroom to a stranger. For starters, there's no legal or practical way to modify my home to allow either of us any sense of privacy or freedom to come and go without being a significant disruption to the other.
- jjav 3y ago
  > because they're paying the same nominal property tax rate from 40 years ago This is a myth. Nobody is paying the same property tax from 40 years ago. Property taxes in California go up 2% every year under Prop 13. It can be argued whether costs should increase faster or not, but in any case it is factually incorrect to say someone is paying the same as 40 years ago.
HDThoreaun 3y ago
Vacancy rates across the country are extremely low. Generally around 4-5% when it's next to impossible to get below 3% due to structural frictions around moving and repairs.

ryukafalz 3y ago

Don't have sources offhand but my recollection is that vacancy taxes have also been tried before and, while they do have some effect, the vacancy rates in most locales with high costs of living are already low enough that it doesn't help that much. Vacancy rate statistics include things that are pretty natural and you wouldn't really want to penalize, like an apartment being briefly vacant after the previous tenant moves out and before the next tenant moves in. So you can't just look at the rental vacancy rate in a city being (say) 3% and conclude that those 3% of units in the city are being held vacant and off-market. There may be some of those, but it's a far lower percentage. Which is to say, institute a vacancy tax if you like (it won't really hurt if done sanely), but realize that it won't be a silver bullet here.

ZoomerCretin 3y ago

This is so difficult to enforce. You're going to have people go door-to-door checking if houses are vacant? What if someone goes on vacation? States require legibility. The simplest way to enforce high land and property utilization is to tax all property. In California, for example, you have reports of people who move and use their old home in the Bay Area for storage because they're paying the same nominal property tax rate from 40 years ago. If they were paying a yearly 1% tax on the value of their property (instead of <0.05%), they'd rent or sell it immediately. Same deal in China, except more extreme. Property _is not taxed_, so there are/were a lot of people building apartments and leaving them vacant, waiting for prices to rise over time. Neither of these situations serve the material needs of people today who need cheap, high-quality, and abundant shelter. Plus, your vacant property tax proposal excludes the (500k+?) many empty bedrooms in occupied homes. If someone's kids have grown and moved out, their old rooms are now vacant. How many people simply leave these rooms vacant for years and decades? A blanket property tax increase would strongly incentivize the renting of these rooms.

brewdad 3y ago
Maybe I'm just a grumpy old man but you'd have to raise my property taxes (already above the national median) by 3-4x before I'd even consider renting out our empty bedroom to a stranger. For starters, there's no legal or practical way to modify my home to allow either of us any sense of privacy or freedom to come and go without being a significant disruption to the other.
jjav 3y ago
> because they're paying the same nominal property tax rate from 40 years ago This is a myth. Nobody is paying the same property tax from 40 years ago. Property taxes in California go up 2% every year under Prop 13. It can be argued whether costs should increase faster or not, but in any case it is factually incorrect to say someone is paying the same as 40 years ago.

HDThoreaun 3y ago

Vacancy rates across the country are extremely low. Generally around 4-5% when it's next to impossible to get below 3% due to structural frictions around moving and repairs.